The electric automobile market is
booming as more and more consumers are looking to go green and to
reduce the emissions and the amount of fuel that they consume. There
are a number of electric cars and hybrids on the market today with
cars like the Prius and the Tesla Roadster.

California
governor Arnold Schwarzenegger hinted earlier today that Toyota and
Tesla had plans to produce vehicles together. Now, the cat is officially out of the
bag.

Toyota is lending a hand to Tesla Motors in the development of
future electric vehicles including the next generation Roadster and
the upcoming
Model S sedan. According to a joint press release, Toyota will
help Tesla with the development of "electric vehicles, parts,
and production system" and it will also offer engineering
support.

The Japanese auto giant will be funneling a relatively
paltry -- for Toyota -- $50 million into Tesla through the
purchase of common stock. Tesla will also take over the NUMMI
manufacturing plant in Fremont, CA that was to be shutdown after
GM went bankrupt and Toyota was left without a partner to run the
facility.

"I sensed the great potential of
Tesla's technology and was impressed by its dedication to monozukuri
[Toyota's approach to manufacturing]," said Toyota Motor
Corporation President Akio Toyoda. "Through this partnership, by
working together with a venture business such as Tesla, Toyota would
like to learn from the challenging spirit, quick decision-making, and
flexibility that Tesla has. Decades ago, Toyota was also born as a
venture business. By partnering with Tesla, my hope is that all
Toyota employees will recall that 'venture business spirit,' and take
on the challenges of the future."

According to Tesla CEO Elon Musk -- and
reported
by Autoblog -- by keeping NUMMI open, 1,000 employees will
be brought back into the fold to build new electric vehicles. Those
1,000 employees could pump out roughly 20,000 vehicles in the first
year. However, the plant has the capacity to build up to 300,000
vehicles a year and can employ up to 10,000 workers.

"The Tesla Factory effectively
leverages an ideal combination of hardcore Silicon Valley engineering
talent, traditional automotive engineering talent and the proven
Toyota production system," said Musk. "The new Tesla
Factory will give us plenty of room to grow."

"We look forward to learning and
benefiting from Toyota's legendary engineering, manufacturing, and
production expertise," continued Musk.

Tesla couldn't have asked for a better
partner in Toyota to develop electric vehicles. Toyota has a vast
portfolio of hybrid vehicles and expertise in electric motors and
battery design. The company also has very deep pockets and a wealth
of knowledgeable engineers.

With Toyota's backing, we can count on
the Model S sedan being on track for its 2012 debut. The Model S will
have a base price of $49,900 after a $7,500 federal tax credit, dash
to 60 mph in around 5.5 seconds, and will have a driving range of
roughly 300 miles.

Despite all the positive news
surrounding this announcement, there is one big loser in all of this:
the town of Downey, California. Tesla was all set to work on an
assembly plant in the town until it was wooed away to the Fremont.

"To think of all the time and
effort that has been needlessly wasted by Downey due to Tesla
misleading us is unconscionable," said
Downey Mayor Pro Tem Luis Marquez, according to The Downy
Patriot. "The question must now be asked if Tesla plans to
reimburse all the costs associated with their underhanded negotiation
tactics."

"Mr. Musk gave me his word Tesla
would be coming to Downey. Today I learned the same lesson several
other cities have learned when dealing with Mr. Musk,"
complained Councilman Mario Guerra. "I learned just how
disingenuous Tesla was in their dealing with Downey and I now have a
new appreciation why the public is fed up with corporate America. To
think, Downey had planned to sign the lease tomorrow."

"There is a single light of science, and to brighten it anywhere is to brighten it everywhere." -- Isaac Asimov